IndiGo will hold an extraordinary general meeting on January 29 as per a requisition by promoter Rakesh Gangwal and his associates in order to amend the articles of association.
In an exchange filing, the company said that the EGM has been called for a special business, which is to “amend on the Articles of Association of the Company by deleting articles 1.6 to 1.15 (Transfer of Equity Shares), 1.16 to 1.20 (Acquisition of Shares) and 2A (Other provisions on Equity Shares) from the Company’s Articles of Association.”
“The Board of Directors of the Company (“Board”) be and is hereby authorised to do all such acts, deeds, matters and things as may be necessary, proper or expedient and to execute all such documents, instruments and writings as may be required, to give effect to this resolution,” the company further added in the special business to be presented on Jan 29.
It is important to note that EGM was one of the primary demands made by Rakesh Gangwal in the letter written to SEBI on Jul 8.
“In a split vote, the Board taking the decision to not allow an Extraordinary General Meeting of shareholders (EGM) upon being requisitioned by shareholders with approximately 37 percent of shareholding in the Company and also refusing to cooperate and provide the necessary information for the requisitionists to conduct the EGM themselves despite this right being available under law,” Gangwal had said while giving an example of “collapsing corporate governance standards” at IndiGo in the letter.
The two promoters of IndiGo, Rahul Bhatia and Rakesh Gangwal, have been involved in a legal battle overseas since October and neither side has released any official statement on a resolution so far. As of March 31, the two promoters hold 74.93 percent share, while the rest 25.07 percent is held by the public. Bhatia and his associates hold the highest stake in the company at 38.3 percent, followed by Gangwal and his associates at 36.6 percent.
The differences between the two promoters of IndiGo came out in the public eye in July when Gangwal wrote a letter to the Securities and Exchange Board of India (Sebi) and claimed that the standards of corporate governance at the airline are faltering and also alleged that some questionable related-party transactions have taken place between IndiGo and Bhatia-owned InterGlobe Enterprises.
While there have been a series of statements from either side post the public spat, the annual general meeting held on August 27 had indicated that the two sides were working towards a settlement.However, the fledgling signs of truce at IndiGo soon began to disappear as Gangwal's legal counsel wrote another letter to Sebi on August 30, asking it to take action with respect to the rights of Bhatia's InterGlobe Enterprises group and IndiGo's non-independence of chairman M Damodaran among other issues.